Retail + Digital

Monthly Archives: April 2017

There are benefits for customers in getting over the online shopping ‘privacy bump’ as it’s known in retail circles. Giving away your personal data for rewards is looking a whole lot more interesting, with the prospect of having over 300 global luxury boutiques (and their inventories) at your beck and call, whenever, wherever and whether you prefer to shop on or offline.

Farfetch Store of the Future magic mirror

That’s the main premise behind the new FarfetchStore of the Future concept, a connected retail app that joins the dots between physical retail and online shopping behaviour, via the latest in-store tech – from RFID-enabled merchandise and magic mirrors to WeChat payment and Apple Pay. Launched to partner retailers and brands at the luxury boutique platform’s first ever FarfetchOS conference last week, the universal login app offers consumers the opportunity to combine their digital wishlist wanderlust with a live in-store experience. Meanwhile, brands that sign up to the bespoke suite of tech, can tap into shopping data analytics driven by Farfetch’s 1.6 million customer records. That’s a lot of valuable data right there.

Now that consumers are increasingly demanding more frictionless and seamless shopping experiences (thanks to our growing online habits), physical retail is under the spotlight to up its game by mirroring online data mining. Unsurprisingly, José Neves, Farfetch founder & CEO, says he is a huge believer in physical stores and they are not going to be vanishing anytime soon.

‘Physical retail accounts for 93% of sales today, and even with online growing at fast speed, it will account for 80% by 2025. Retailers need a way to collect information about their customers while they are browsing in-store, just as they collect data from online searches, says Neves. More to the point, and according to a new report by market research firm Bain & Co (in partnership with Farfetch), just over 70% of high-end purchases in stores are influenced by online research first, making the physical store ‘critical’ to the future of retail.

Neves calls this new era of retail ‘augmented’, or a time for brands to use technology in-store like an ‘offline cookie’ that closes the loop between a store’s online presence and the experience of customers shopping in-store.

An understated grey marble and blonde wood pop-up store structure, complete with LED lit walkways and Perspex walls was installed at London’s Design Museum for last week’s FarfetchOS one-day event, which served as the first physical manifestation of the Store of the Future concept. Fellow members of press and brands were given tours of how the retail tech would be implemented, with Farfetch senior management explaining the intricacies of the RFID (radio-frequency identification) enabled merchandise system that picks up specific human movements and digitally adds pieces browsed by customers to their personal app wishlist.

Next up, a connected changing room and magic mirror allows customers to try on their in-store selection, swap sizes or source out-of-stock items via other boutiques within the Farfetch network. “It’s all about customer recognition and optimising the customer’s intent to shop,” says Gavin Williams, Farfetch’s director of product development for Store of the Future. “Universal login is a theme throughout this concept. We want customers to opt in for everything – they can swipe yes for items they want to add to their wishlist, while they can also say yes I like that but I don’t want to buy it now and the app remembers for later.”

The app also allows the sales staff in-store to pull up new merchandise notifications, and assist on more detailed personal preferences once a customer is satisfied with their selection. This frees up sales staff from being stock pickers to being what Neves calls ‘instore influencers’. Each customer is assigned a dedicated connected changing room and mirror display unit and this is where the technology allows the store staff to ‘dynamically’ update wishlists, order out of stock items, or even call up related recent purchases. Meanwhile, all this information is stored by Farfetch’s team of data analysts and shared with partner retailers. Of course!

The mirrors also support frictionless payments – for example Apple Pay or credit card details stored in each customer’s universal login. “For busy customers, the future of in-store payments is one touch and go,” says Williams.

By introducing the mirrors as personalised digital display units, the system also starts a retailer-customer relationship that can be continued after the store visit is over. And increasingly within luxury boutiques, consumers want to do transactions via chat, especially WhatsApp according to Williams, who adds that conversational-commerce will be a significant driver for luxury sales in-stores. “This is how people communicate and shop now. Those interactions can be live and data is utilised across the entire chain.”

Complementing the Store of the Future concept, Farfetch also introduced a customisable product station in collaboration with shoe designer Nicholas Kirkwood, where customers can use the app to design personalised loafers in a range of colours, fabrics and monogram options. One of the Bain research highlights was that consumers say they want more influence over the products they buy, and this type of personalisation service allows more “signals about the customer,” according to Williams.

The launch of The Store of the Future concept was essentially a sales pitch for luxury brands to buy into it and partner with Farfetch. The full range of technology options is still in beta and will be tested this autumn in the Browns boutique in London and Thom Browne’s flagship in New York. Going forward, other brands and retailers can choose which of the modular technologies they want to incorporate in their stores.

But the message for consumers is to embrace this concept as a version of Internet of Things for luxury stores. Williams compares it to Uber: ‘If the boutiques we work with are willing to aggregate all their transaction data then the app can be truly universal. That way consumers can get VIP treatment in hundreds of boutiques around the world. People saw the utility potential in Uber – if they see the utility value of their shopping data they will share it.’

Retail Planner takeouts:
While I’m a big advocate of phygital retail and welcome the march of new tech applications that enhance my shopping experience, the compromise seems to be that consumers are increasingly being asked for their data in exchange for more personalised shopping habits. The Store of the Future concept by Farfetch promotes retail for the convenience age. Time-poor and cash-rich, global jet-setting HNWIs like to keep it frictionless and fast, without much room for serendipity. But does convenience come at a cost?

Stepping away from the fact the concept is owned and operated by Farfetch, and is powered by its network of global boutiques, I wonder if this new era of data-centric, customer recognition shopping will percolate further down the retail chain and into high-street territory. High-end designer stores have more scope on high-ticket merchandise and therefore are more service orientated. Much of the Store of the Future activity is geared towards ‘upselling’, which might work for mid-market or premium high-street brands, but not so much, once price dictates less one-to-one customer interaction.

However for the purposes of FarFetch’s aim to be ‘where disruptive innovation meets luxury fashion’, the target is high-end transactions, looking after VIP customers, and a menu of data analytics available to interested parties. Time will tell if the company’s ‘Store of the Future’ concept delivers its promise of merging both on and offline retail for customers and brands alike. And as the first billion-dollar fashion tech unicorn, it has deep pockets to keep trying.

This spring, sustainability is top of mind for a host of fashion brands on my radar – from high-street to high-end luxury – as consumers increasingly expect the labels they choose to wear, to have an ethical standpoint and transparency at the heart of their manufacturing process.

H&M Conscious Exclusive SS17

Nurturing sustainability innovation

H&M has just announced the winners for its annual Global Change Award, now in its second year and originally set up to help back fledgling design and innovation talent, in order to help the fashion industry to be more sustainable.

With the premise that progressive ideas in fashion will drive future change, the H&M Foundation and a panel of experts select the five most promising innovations (from nearly 3000) and between them, they get a share of the €1 million grant money.

The top innovator and winner this year was Wine Leather, a company that uses natural grape skins recycled as zero-emission nylon or synthetic leathers. It collects a €300,000 grant which will be spent on the company’s aim of reducing the damage that producing animal and synthetic leather does through its water, chemical and energy consumption. Second in line was Solar Textiles winning €250,000 for its bid to harvest the Sun’s energy to develop new textiles using only water, plant waste and solar energy in its production process.

Further winners include Denim-dyed Denim that looks to the use of old jeans scraps for new denim colour dyes, in a bid to reduce the amount of water, energy and waste the industry uses to produce jeans today; also in the top five is something called Content Thread, a fibre that is RFID-enabled and can be woven into the fabric of clothes to provide a digital list of ingredients that item is comprised from, meaning it is easier to recycle at the end of its life.

H&M Global Change Award SS17

Red carpet ready & recycled

And the Swedish fast-fashion giant continues to push its premium approach to sustainability with its Conscious Exclusive collection that has just launched into stores and online on April 20. The new spring/summer 17 range features pieces made from recycled fabrics and shimmering partywear that uses recycled plastic bottles for the sequins or pailettes. Highlights include a sweeping blush-coloured red-carpet-ready ‘Bionic’ dress that uses fluid fabric repurposed from plastic water bottles harvested at sea. ‘We know our consumers want to see more sustainably produced fashion, so with the Conscious Exclusive collection we try to make that choice as premium as possible,’ says Caterina Midby, head of sustainability design for H&M. Midby says H&M’s Conscious collections are made with 20% of fibres recycled from its in-store garment collecting programme and it is current limited to that 20% because fibres become shorter when they are recycled so need to be blended with organic or other sustainable materials for durability. ‘Conscious Exclusive is a limited edition range and it usually sells out quickly. We know our customers want more of this so we are investing in more sustainability-focused manufacturing processes so we can produce more pieces and get them into more stores,’ she adds.

With the luxury positioning of H&M’s Conscious Collection (red carpet and celebrity endorsements) combined with the brand’s focus on innovation in design, consumers are left with a luxury impression of the brand putting it on a par with designer sustainability brands such as Edun or Moynat.

Upcycled denim on the high-street

Staying with Swedish fashion retailers, Lindex is another brand ramping up its sustainability offer. At a press launch last week, the fast-fashion retailer was promoting its latest clean indigo dye treatment which is now used across nearly 90% of the brand’s denim. Cleaner denim production is better for the environment and the people working with it, says the company. ‘This step forward in our denim manufacturing means we are closer to our goal that 80% of all processes will be more sustainable by 2020. We work on reducing the environmental footprint in all part of our denim production, from fibre to finished product.’

The retailer has just launched its Re:Design range of upcycled denim pieces, which builds on its Better Denim branding across the whole range in-store. There is a bespoke element to the Re:Design pieces – a kimono coat is reconstructed from several pieces of denim that were once jeans or a jacket, while the panelled jeans feature contrasting coloured pieces of denim – they are all made from previously unsold denim ranges that Lindex does not want to send to landfill or sell on to third parties. ‘We have established the Better Denim branding across the collection now,’ says Sara Winroth, production sustainability manager for Lindex, who says the Re:Design range is Lindex’s latest initiative that aims to offer something a touch more exclusive while utilising fabric the company has already accounted for.

Sustainability campaign messages

Designer e-tailer Not Just a Label has collaborated with washing machine brand AEG to launch Care Label Project, a sustainability initiative that encourages consumers to prolong the lifespan of their wardrobe and reduce the environmental impact of washing clothes.

14 emerging designers from across Europe have joined AEG’s own-label platform, the Care Label Collection help to promote the washing advice on labels. The collaborative design project features advice such as instructions to ignore ‘dry clean only’ garments that can in fact be washed on a gentle or low temperature wash, while they have added a label that reads ‘don’t overwash’ for current collections available on the Not Just a Label website.

AEG x Not Just a Label

‘If you buy good-quality denim jeans, you could wear them for maybe 10 or 20 years. If you know how to look after, wash and care for them, they could live with you for ever,’ says Han Ates, a collaborating designer in the Care Label Project.

Meanwhile in a similar vein, designer Stella McCartney has launched a new sustainability campaign Clevercare, which is a care symbol, a website featuring simple clothes washing advice and a communications campaign including several humorous Youtube videos.

Stella McCartney Clevercare campaign

Retail Planner take-outs:

Consumers have an increasing appetite for sustainability messaging from high-end luxury initiatives such as Kering’s EP&L app, the Stella McCartney Clevercare campaign, or the more recent Not Just a Label x AEL labelling collaboration, through to high-street brands and their continued efforts to produce premium pitched collections made from recycled fabrics.

Retailers need to ramp up their sustainability communications in-store; telling the story of transparency is more meaningful when there is an ethical standpoint across the marketing spectrum.

Denim is a crucial product category for sustainability innovation and many retailers are now utilising this wardrobe staple to leverage their sustainability messaging to consumers.